New Delhi, Jan. 18: The Union cabinet today approved the listing of five state-run general insurance companies - General Insurance Corporation, New India Insurance, Oriental Insurance Corporation, National Insurance Corporation and United Insurance Company - on the bourses.

The listing will be done through fresh share issues, finance minister Arun Jaitley said after today's cabinet meeting. The government holding in these companies will gradually come down to 75 per cent from 100 per cent, the minister said.

The possibility of the listing of state-run general insurers was announced in last year's budget by Jaitley.

"Public shareholding in government-owned companies is a means of ensuring higher levels of transparency and accountability. To promote this objective, the general insurance companies owned by the government will be listed on the bourses," he had said.

According to officials, these IPOs could be floated after share splits to make them affordable to retail investors, though the main target will be banks, pension funds, mutual funds, FIIs and sovereign wealth funds.

New India and GIC have already taken board approvals for floating their initial public offers.

New India, founded by the Tatas at the end of World War I and nationalised in the 1970s, has assets of over Rs 60,000 crore and premium income of over Rs 18,000 crore. Analysts believe a 10 per cent share float could fetch Rs 5,000 crore.

GIC is the country's sole reinsurance company with total assets of Rs 80,000 crore and has reserves of nearly Rs 14,000 crore. A similar 10 per cent float in GIC could easily fetch the government Rs 8,000 crore, analysts said.

The general insurance industry has welcomed the decision even as the General Insurance Employees Union opposed the move and instead demanded a merger of these insurers into a single monolithic corporation.

"We welcome the government decision. We are awaiting further directions such as the timeline, valuation to go ahead," National Insurance Company chairman Sanath Kumar told a news agency.

New India Assurance chairman G Srinivasan said, "We will now start the process and it may take six to eight months from now. Our board will meet shortly to take a call on the listing process."

A GIC official said: "It makes sense to come up with an IPO now when GIC is a strong monopoly. We will open up re-insurance eventually but for many years from now that opening will be partial."

Officials feel listing will have other benefits, including making state-run insurers more accountable.

"Details on our financial performances, business growth as well as future expectations from business have been sought by the ministry officials," said a senior official in a PSU general insurer.

Sources said the listing process will be finalised over the next few weeks. Based on financial performance, New India Assurance could be the first to hit the market.